Petrol price may be reduced by about Re 1 per litre while diesel price may be hiked by 40-50 paisa a litre from March 15/16.

While petrol prices are being cut in step with falling international oil rates, diesel rate increase would be in line with the January decision to raise prices in small doses every month till all of the Rs 11 per litre losses are eliminated.

Sources said the revision in rates of petrol and diesel are likely to be announced as early as Friday.

The cut in petrol price will follow two rounds of hike in rates since February. Petrol price was hiked by Rs 1.50 a litre on February 16 and then by Rs 1.40 per litre from March 2. Both the increases were excluding local VAT.

Petrol in Delhi currently costs Rs 70.74 a litre.

Since last revision, international gasoline (petrol) prices have come down to about USD 120 per barrel from USD 131.00 a barrel at the last time last revision. Also, the rupee has marginally appreciated against the US dollar to Rs 54.11.

Diesel prices have been since January hiked by over Re one per litre in two instalments and it currently costs Rs 48.16 a litre. Despite the increases, oil firms lose Rs 11.26 per litre on sale of the nation's most consumed fuel.